Wine prices likely to rise further in 2019

Buying wine will become more expensive for UK consumers as we move into 2019. The effects of the ongoing Brexit negotiations, along with tax increases could mean that your favourite bottle will rise substantially.

While taxes on spirits, beer and cider will remain frozen, they will rise for wine in February. It was announced by Chancellor Philip Hammond in the October 2018 Autumn Budget that wine taxes will increase with inflation in Q1 next year.

Buying wine always popular

While the UK will always remain a nation of wine lovers, when the country leaves the EU prices could also be affected. If the country leaves the European Union without a deal, a situation that looks like a possibility since the Prime Minister delayed the MP’s vote on her deal before Christmas, then wine importers could have problems at the borders.

Even though the UK wine industry is on an upward curve, we still import the majority of the wine sold over here. And the wine industry is warning that importers could well face delays at the borders if there is a ‘no deal’ Brexit. This is following rising inflation and additional import costs over the last couple of years.

Possible import delays
Chief Executive of the Wine and Spirit Trade Association, Miles Beale, says: “If we come crashing out of the EU with a ‘no deal’ scenario, this would cause delays at borders hugely affecting the supply chain and inevitably pushing up prices for consumers.

“The industry’s ties with the EU run deep – 55 per cent of wine consumed in the UK is imported from the EU, while 45 per cent of spirits exported from these shores is sent to the EU making a “no deal” Brexit an extremely alarming prospect.”

The average bottle of wine has risen in price by approximately 30p since June 2016, when the vote to leave the EU took place. Around 99% of the wine bought in the UK is imported, which could cause issues for major distributors, but it’s not all about Brexit.

Chancellor Philip Hammond announced in the Autumn 2018 budget that taxes will change in 2019. From February, wine taxes will go up from 7p per bottle of still wine and 9p on a bottle of sparkling. The wine industry is undergoing taxes that aren’t being levied on the beer, cider and spirt industry. Adam Lechmere from the International Wine & Spirit Competition says: “It’s not as though beers and spirits have escaped in the past – the impact has been quite large over recent years. However, when considering this particular Budget, 9p and 7p is quite a hike when looking at the average price rise.”

Report shows 2018 broke fine wine investment records

Reports show that investing in fine wine is a more stable bet than buying gold, making it one of the most sought-after asset classes. The Liv-ex summary of the 2018 fine wine investment market says it is “a record-breaking year.”

The research shows that most of the top 100 investment wines revolve around Bordeaux, which has been “steady, consolidating after two years of strong gains”. Burgundy comes out the most impressive performer.

Fine wine investment index

The Fine Wine 1000 index by Liv-ex is described as “the broadest measure of the fine wine market”. Over the year, the index increased by 10.2% and Burgundy is responsible for a lot of the growth, rising by 35.5%.

The ten most impressive price rises were all Burgundy. This shows that demand for the highest end wines in this region is high and is likely to continue to increase prices over the next year.

Record-breaking wines in 2018 include two bottles of Romanee Conti 1945 that sold for just over £443,000 and £394,000 respectively. And while these grabbed media headlines, the wider market for Burgundy has been quietly growing. Collectors are buying more into estates including Roumier, Leflaive, Leroy and Rousseau.

Widening interest from investors

As well as the strong interest in Burgundy, the research also shows a clear trend for investors to widen their interest. Many are now looking past Burgundy and Bordeaux to other regions including the Rhone, California and Champagne. Wines from these regions are making impressive gains, but from smaller base levels than Burgundy.

Leaving aside the Live-ex 1000, the more exclusive index (Liv-ex 100) concentrates on only the most expensive wines. This increased in value by 0.22% within a narrow range of 2%, making it “more stable than gold” over the course of this year. This Is partly because the index is in Sterling, and there has been a somewhat stable pound against the Euro over the year.

For 2019, the index says that the fine wine market is “in good health, offering steady returns and low volatility compared with other mainstream assets”. The summary also mentions the doubts cast over the industry due to the uncertainty surrounding Brexit, saying: “The outcome of Brexit negotiations will likely affect the price of fine wine because currency volatility influences the levels of interest from non-Sterling buyers. However, this might be less of an issue for regions with high demand and relative scarcity such as Burgundy and Piedmont.”

Which trends will dominate the wine industry in 2019?

Wine may be considered a luxury for many people, but the way the wine industry reacts to challenges often shapes the way consumers make their choices.

There are lots of reasons why people buy wine. For example, it’s the most gifted product at Christmas. But according to a 2018 study on the habits of wine consumes, 79% of wine buyers just like the taste, indicating they are not swayed by origin or ingredients. The survey also showed that 80% of people say that the cost is the main factor to consider when choosing wine.

Wine industry reacting to consumer tastes

Getting value for money will remain top of the list for the average consumer in 2019. As many countries are going through a period of political and economic changes, this inevitably affects the way people choose to spend their money. Often, this means more people spending less.

In the US, the relative strength of the dollar means certain German wines are more affordable. German Rieslings are likely to be popular, as buying trends pick up after a slow few years. Other great value options for UK and US buyers include rosé from French regions outside of Provence. For example, rosé from Loire, the Rhone Valley, Bordeaux and Gascony will be popular next year.

Environmental impact on wine-making

This year has been phenomenal for UK wine makers, with the biggest and best grape harvests likely to lead to a bumper vintage. And while this is a positive side-effect of rising temperatures, it also shows how much the wine industry must adapt to the new normal. Weather patterns are far more unpredictable, and this will continue. Winemakers are taking note of the changes in climate and their effects on the industry all over the world.

In California, winemaker Laura Diaz Munoz says that increases in temperature and the corresponding stress on water supply are among the environmental concerns for 2019: “Cooler regions are not cooler regions anymore.” She suggests that the industry will adapt by planting in new regions and changing varieties of grapes to match the climate changes.

Owner of Garden Creek Ranch Vineyards & Winery in California, Karin Warnelius-Miller agrees. She says: “In California, we are now living in a different reality than years past. Fires, smoke taint and drought – these are our dominant concerns for 2019 and into the future.”

Health and well-being

As well as the effect on wine-making from climate change and a drive towards value by consumers, 2019 will likely see a continuation of people balancing alcohol intake. Wine is being enjoyed more as part of a meal than as a standalone drink, and there is a corresponding interest in lower alcohol options. Journalist and expert on trends in the wine industry, Deborah Parker Wong says: “The wine industry’s commitment to education is exemplary and the emphasis on consuming wine with food is ever present.”

These are just some of the industry and consumer trends that will affect how people choose their wine as we move into 2019.

Could Chardonnay be a good choice for a Christmas wine?

When it comes to shopping for Christmas wine, most people stick to the tried and tested favourites. For some, it’s all about the fizz, whether Champagne, Cava or Prosecco, for others it’s about a nice red to go with dinner.

If you’re looking to simplify the Christmas wine options, then you could look at resurrecting an old favourite with a nice Chardonnay. There are plenty of options for this wine, particularly when it comes to looking for something that will be a good all-rounder.

What is Chardonnay?

Having been very popular a couple of decades ago, Chardonnay somewhat went out of style over recent years. However, it’s long been due a comeback, so why not at Christmas time?

Chardonnay is a very neutral grape. It’s known as a ‘winemaker’s grape’ as it’s relatively easy to grow. It’s also very adaptable and can be made into different styles of wine, ranging from crisp and fresh to buttery oak. When fermented, Chardonnay grapes have notes of green apple, and sometimes tropical flavours such as pineapple.

If a second fermentation is processed, then the tart green apple notes transform to buttery oaky creaminess. Some winemakers alter the style even further by ageing it in oak barrels. This adds further flavours such as vanilla, caramel, butterscotch and toast.

Choosing a Chardonnay

For those who like their wine light, then a Chablis is a good choice. For a very fresh taste, choose a recent vintage. Both 2016 and 2017 were good years, according to experts. It goes with anything light and is perfect for the fish course.

For a creamier, fuller style of white, you could go for the pricier option of a Chassagne-montrachet. To keep the budget down, try Vire-Clesse or Macon-Vergisson from the Maconnais region in central France.

Elegant varieties of Chardonnay can also be found from South Africa, Australia, New Zealand and Chile. Any are good with turkey, if you don’t want another red wine, and go spectacularly with the traditional leftovers.

If you’re not sure Chardonnay is for you – perhaps you find the deep, oaky flavour a bit much – then try one from the Jura, on the Swiss/French border. These have an almost savoury, nutty flavour that means they go well with cheese.

Rock legend Jon Bon Jovi’s rosé wins industry accolade

Legendary rock stars from the 80s and earlier often turn their hand to something unexpected later in life. Iron Maiden’s Bruce Dickinson enjoys flying planes, while The Stone’s Ronnie Wood paints portraits. And if you’ve ever wondered what rock god Jon Bon Jovi has been up to since his heyday, wonder no more.

Earlier in 2018, he launched his own brand of rosé wine, named Hampton Water, along with his son Jesse. To the surprise of many, the wine made the Wine Spectator’s top 100 best wines of the year. But, much more excitingly than even that, it’s been named the best rose wine of 2018, which is a huge accolade for a young brand.

Best rosé wine of 2018

Hampton Water is named for the summers the Bongiovi family spend in the Hamptons, sipping rosé and enjoying the fruits of a rock star lifestyle. Bon Jovi’s son, Jesse Bongiovi came up with the concept and went into business with his famous dad. And while this could have been dismissed as a vanity project, the Wine Spectator gave Hampton Water a high rating of 90, making it the best of the year on their list.

French wine expert Gerard Bertrand worked with the label to produce the winning rosé. So, while the wine is named for an American holiday destination, it’s actually made in France. A blend of Consault, Grenache and Mourvedre grapes, the wine is described as ‘the perfect companion for any occasion’.

What makes a good rosé?

It could be that star power is behind the wine’s initial success, but it’s an impressive start for a new wine. So, what makes a good rosé? There are various misconceptions surrounding rose wine, as it was traditionally considered rather inferior to red and white. However, over the last decade, rosé has exploded in popularity in the US and Europe, as people discover its light, refreshing flavours.

There are also misconceptions in how rosé wine is made. Contrary to some popular belief, you can’t make it by mixing red and white wine. Instead it’s all about skin contact. When any grape, whether red or white, is juiced, the resulting liquid is clear. The colour comes from the contact between the juice and the grape skins. For example, soaking red grapes with the juice imparts the colour into the final product. This is called ‘maceration’.

Rosé wine is made by juicing red wine grapes and leaving the skins to soak for a very short period. This is usually only a matter of two or three days. As soon as they can see the juice turning slightly pink, the maker will remove the skins and let the juice ferment.

The wine region consistently making the best rosé wines is Provence in France. It creates more rosé than any other wine variety, and consequently have become skilled at this particular wine. As the growing region is so vast, there are rosé wines available at all price points. So, if a rock star’s wine isn’t quite to your taste, ask for a rosé from Provence and you’ll be on the right track.